UPDATE 2-Bank of China not optimistic about 2017 after profit drop

SHANGHAI/BEIJING, March 31 (Reuters) - Bank of China Ltd (BoC) , the country's fourth-largest lender by assets, reported a fall in full-year profit for the first time in more than a decade on Friday, the only one of China's "Big Five" banks to do so.

The most international of China's largest listed state-owned lenders, BoC follows the other four in posting its lowest interest margin since at least 2011, due to successive central bank interest rate cuts between 2014 and 2015.

BoC President Chen Siqing told a briefing late on Friday that the bank was facing a declining interest rate environment, where it was "impossible" to receive high interest income, even as the lender is forced to pay more for its funding.

The compression in net interest margin - the difference between interest earned on loans and interest paid out to depositors - continued in the fourth quarter, falling to 1.83 percent from 1.85 percent at the end of September.